Legal, political dispute over Trans Mountain pipeline is complex and Alberta needs to chill

No easy answer to thorny constitutional issues, respectful dialogue between British Columbians and Albertans will help

So, John Horgan wants feedback from British Columbians about potential restrictions on dilbit shipments from Alberta and Rachel Notley says Alberta may sue and retaliate with stopping imports of BC electricity. Did anyone think the dispute over the Trans Mountain Expansion pipeline was not going to be ugly? Well, hang on, you ain’t seen nothing yet.

When Christy Clark and the BC Liberals ruled the roost in Victoria, they made a show of being tough about the 525,000 b/d Kinder Morgan project, but never seriously challenged Canadian constitutional authority over inter-provincial pipelines and were happy to be bought off with promised company contributions to provincial funds.

Alberta Premier Rachel Notley at Wednesdays media event. Source: CBC.

But that did nothing to lessen opposition from other key players, including coastal First Nations (led by the Tsleil-Waututh Nation whose traditional territory includes Burrard Inlet, site of the Westridge Terminal), the City of Burnaby (presumably joined by Vancouver and other lower mainland municipalities in the fullness of time), and the Canadian environmental movement, whose epicentre is Vancouver.

Frequent legal challenges were a given.

Large and disruptive protests were inevitable, especially after the Standing Rock Sioux of South Dakota opposition to the Dakota Access pipeline during the summer of 2016 that dragged into the winter before the election of President Donald Trump brought the full weight of the American government to bear on behalf of Energy Transfer Partners LP.

BC First Nations allied themselves with the Standing Rock protesters and absorbed important lessons firsthand, like how to manage a 5,000 person “protest village” and crowd fund online to the tune of $1.5 million a day.

Even if Clark had remained premier after the May 2017 election the push back in British Columbia was going to be nasty and lengthy.

But the BC NDP forming government last summer changed the political calculations of the Trans Mountain opponents, who now enjoy a government ally comprised of politicians who had openly campaigned against the pipeline.

BC Environment Minister George Heyman, forefront, Attorney General David Eby.

While the new Attorney General David Eby mused last fall that Horgan and company worried about being sued for billions by Kinder Morgan if the Province appeared to be using its powers to obstruct construction, that reticence soon disappeared after Environment Minister – and former Sierra Club BC executive director – George Heyman took control of the government’s campaign to grind down the company’s resolve by any means possible.

Are the prospective regulations restricting dilbit shipping a surprise?

Only if you’ve been hiding under a rock for the past three years, including not reading any of my many columns warning about this impending perfect storm of awful for Alberta pipeline aspirations.

Yet, somehow, far too many Albertans were caught unawares, judging by the outraged bellowing wafting over the Rockies this past week.

Cut off their oil! BC gets most of its gasoline from Alberta oil shipped over the original Trans Mountain pipeline.

Boycott their wine! Yeah, that’ll show ’em. A more meaningful protest might be for all the wealthy Albertans with cottages or second homes in British Columbia to sell their property and their money and go home.

Premier Notley did suspend talks with BC about buying $500 million a year of electricity. And she hinted at further sanctions if Premier Horgan doesn’t capitulate.

But she also made clear her preferred option: “We are prepared to do whatever it takes to get this pipeline built. But in the meantime, and instead, the federal government can intervene. They can put an end to this conflict.”

By federal government, the Premier means Prime Minister Justin Trudeau, who started promisingly enough, pledging on Thursday that Trans Mountain Expansion would be built, then the following day defending his remarks at a highly publicized town hall in Nanaimo, BC where he was heckled by Kinder Morgan opponents.

BC Premier John Horgan.

But here’s something Albertans can do to support Trudeau and the Canadian government: recognize the complexity of the constitutional issues in play and not go apoplectic every time British Columbia lobs a political grenade in their direction, because there are going to be plenty of those over the next year or two.

As things stand today, Sect 91 of the Constitution and 60-plus years of legal precedent give Canada exclusive jurisdiction over inter-provincial pipelines, authority the federal government has already been wielding through the National Energy Board in disputes between Kinder Morgan and the City of Burnaby over permitting.

But there are two challenges to that authority.

One, the judicial review of the NEB’s approval of the project in the Federal Court of Appeals, which consolidated 15 separate applications, with hearings completed late last year.

A number of the applications are from First Nations arguing that approval of the pipeline by the NEB and Prime Minister violates “the Crown’s duty to consult and accommodate the applicant’s constitutional rights,” according to the NEB. Canadian courts have handed indigenous communities many legal victories over the past decade or two and betting against another victory here would be foolhardy.

There has been no decision yet, but once rendered will almost certainly be appealed to the Supreme Court of Canada. If Ottawa and Kinder Morgan lose there, the project may be in jeopardy.

Two, the BC Government is arguing that under the principle of “co-operative federalism,” its legal obligations to protect the environment it shares authority over Trans Mountain Expansion. The Canadian government stands on “paramountcy,” the long-held notion that when federal and provincial laws clash, federal authority is paramount.

The NEB has ruled against Burnaby by citing paramountcy. Will a court support that interpretation?

BC constitutional scholars say, no. Prof. James Coleman of the Dedman School of Law and my go to expert on this issue, thinks paramountcy will prevail, but if the issue is tested in court, all bets are off.

To make matters even more complicated, this issue isbeing touted in the business community as a test of Canada’s resolve to uphold federal approvals of capital investment and the rule of law. Investors are watching very carefully.

This is the incredibly complex political, legal, and economic minefield Trudeau and the Canadian government must somehow navigate over the next year or two.

That job will be all the more difficult if Alberta loses its collective mind every time the BC government or a BC First Nation or a BC municipality or a BC environmental group makes the evening news with the latest anti-Kinder Morgan regulation or protest.

Believe me, I understand the impulse, as demonstrated by several recent columns expressing my displeasure with the Horgan Government. Upon reflection, however, it is true that one catches more flies with honey than vinegar.

I hope I can take my own advice in the coming months and that Albertans join me in engaging in a respectful dialogue with British Columbians.